In his New Year message, David Lonsdale, the Director of the Scottish Retail Consortium, said:
“2015 was a year of contrasts with shoppers benefitting from stiff competition and keen prices, but with many of Scotland’s retailers facing a testing period and the industry as a whole witnessing the loss of over 3,500 retail jobs. The industry continues to undergo significant transition as it adapts to changing shopping habits against a backdrop of anaemic sales, shop price deflation, rising costs and thin or non-existent profit margins.
“Retailers are working ever harder to maintain let alone grow sales and are rising to the challenges that profound structural and economic change brings through innovating, becoming more productive, and by investing in new online and logistics capabilities and a higher skilled workforce.
“2016 holds out a brighter prospect especially if recent improvements on the employment, earnings and population growth front continue.
“Of keen interest to the industry this coming year will be the outcome of the Holyrood poll and possible EU ballot, and how this affects confidence in the economy and decision making.
“Ahead of what will be a politically charged few months in Scotland there needs to be a thorough debate about how the next devolved government and parliament will help raise the country’s rate of economic growth and about the boundaries of regulatory intervention in the economy.
“Lifting private sector investment will be key. That’s made all the more difficult when costs are rising as it means diverting cash and resources away from growing the business. The cumulative burden of government-imposed tax and regulatory costs has become an acute issue for the industry and has made the trading environment tougher. In addition to the year-on-year business rates escalator, this cumulative burden is seeing retailers grapple with a hotchpotch of measures including the implications of the new national living wage, rises in the national minimum wage, the new apprenticeship levy, statutory increases in employer pension contributions, a mooted £86.4 million Scotland-wide deposit return scheme for drinks bottles and containers, as well as proposals to allow councils to levy local sales taxes.
“This reinforces the need for a more coherent approach to policy making, where business and government as a whole works together to deliver a joint retail industry strategy to nurture the sector and help it fulfil its potential. It also requires our political parties to wean themselves off the rush to regulate and tax, and ultimately adopt policies for the election which keep down the cost of doing business and the cost of living and improve private sector growth. Every policy should be tested against a benchmark of whether it will make Scotland a better place for retailers and other firms to invest and expand.”
